While many Canadians dream of owning a business, not everyone has the original idea or know-how to start a business from scratch. For these people, opening a franchise can be an attractive path to business ownership.
Franchising is a business relationship in which a franchisor (a company or individual who owns the franchise system) grants a licence to a franchisee (a company or person who contracts to use the franchise system). This licence gives the franchisee the rights to operate a business using the franchisor’s trademarks, brand and operating system for a specified length of time.
Here, the Canadian Franchise Association, producer of the FranchiseCanada Show (formerly The Franchise Show) coming to Toronto on Feb. 24 and 25, outlines 10 benefits of investing in a franchise:
- No ‘reinvention of the wheel’ required
When you invest in a franchise, you gain access to and use of its operations systems, products, services, logos and more. If you were starting your own business from scratch, the onus would be on you to figure out all aspects of the business, what works and what doesn’t. With a franchise, you will have the road map to recreate the brand’s success at your location.
- Trademarks and patents
A good franchisor will have already secured the trademarks and patents related to its brand. Franchisees are then licensed to use the franchise’s branding, trademarks and proprietary products, services or recipes. This can save you time and money during the startup process, as there will be no need for you to go through the legal processes to secure the appropriate rights.
- Territory rights
In most cases, you, as a franchisee, will be awarded an exclusive territory, giving you exclusive rights to offer your product or service within your designated area.
- Startup costs estimated
In an independent business, you would be charting new waters. With a franchise, others have gone before you and can provide you with an example of what to expect in terms of startup costs.
- Franchisor support and training
As a franchise system requires consistency in quality and service from location to location, most systems will train new franchisees on the basics of operating their location, such as operational procedures, accounting, marketing, computer systems and more.
- Consumer awareness
A franchise can bring with it pre-existing consumer awareness; though the business may be new to the area, potential customers may already be familiar with the brand. A brand’s history of success may also give you an advantage when applying to a financial institution for a business loan to finance your location.
- Strength in numbers
As a member of a growing franchise network with group purchasing power, you can gain immediate access to established relationships with vendors who have already been vetted for quality and pricing, and may even enjoy perks such as preferred pricing or special delivery.
- Peer network and support
Being part of a franchise system means you have a pool of knowledgeable peers who are just a phone call or email away. If you’re experiencing a business challenge, chances are there are other franchisees in your system who have encountered a similar issue and will have first-hand advice for overcoming it.
- Research and development
Through the franchisor, franchisees can be kept up to date on business trends and consumer tastes and behaviours. They can also benefit from their system’s research and development initiatives for things such as new products and services, technology and marketing. Franchisees can therefore focus on the day-to-day operation of their location, knowing that they will still be on the leading edge in their industry and marketplace.
- Small business ownership
In addition to the reasons already mentioned, don’t forget that you’ll also be a small business owner, operating your own business with the brand and support of the franchisor backing you up. As the saying goes, in franchising you’re in business for yourself, but not by yourself.
Learn more about franchising and meet face to face with franchisors who are expanding in the Toronto area at the FranchiseCanada Show, Feb. 24 and 25 at the Toronto Congress Centre. As the official show of the Canadian Franchise Association, the FranchiseCanada Show offers a mix of some of Canada’s most established franchise brands, plus new up-and-coming concepts. Exhibitors include Booster Juice, Pizza Nova, PropertyGuys.com, Oxygen Yoga & Fitness and more! Learn more and pre-register online at www.franchisecanada.show.